A Sustainable Look at the Belt and Road - Q&A with Fulai Sheng

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Sheng Fulai is a senior economist at the United Nations Environment Programme (UN Environment) in Geneva. Fulai will be presenting the Green Belt and Road Initiative at the Fifth GGKP Annual Conference on Sustainable Infrastructure. In advance of the conference, Fulai discussed the sustainable infrastructure challenges and opportunities of the initiative with the GGKP.

For those who don’t know, what is the One Belt and Road (OBOR) Initiative?

The OBOR initiative has been described as the largest infrastructure project in history. Announced in 2013 by Chinese President Xi Jinping (formally introduced by the Chinese government in 2015), the OBOR aims to build a modern-day “Silk Road” connecting parts of Asia, Europe and Africa by land and sea. Under the BRI, the Chinese government will provide hundreds of billions of dollars of infrastructure investment across 68 countries.

Since the initiative was announced, over 130 bilateral and regional transport agreements have been signed between China and participating countries, covering railways, highways, and maritime transport, including 356 new international passenger and cargo transportation routes. Construction on a number of infrastructure projects under OBOR has already begun, including the 128-kilometer Jakarta-Bandung high-speed rail, the 417-kilometer Kunming-Vientiane railway, and the Belgrade-Budapest railway. At the end of 2016, China and participating countries had been connected through 12 land cables and 4 submarine cables, reaching America, Asia, Oceania, and Europe.

Speaking frankly, how sustainable is this infrastructure project?

The OBOR presents major challenges and opportunities for sustainable development. Infrastructure projects can have serious impacts on biodiversity and ecosystems, and OBOR includes a number of coal power projects, which have serious implications for climate change and air pollution.

However, there are many examples of OBOR-supported clean coal projects that have generated environmental and social opportunities. For example, the Silk Road Fund supported the Hassyan Clean-Coal Power Project in Dubai, which applies “ultra-supercritical technology” to meet the most stringent industrial carbon emission standards of the European Union (EU) while contributing to local environmental protection, energy savings, and emissions reductions. It has also supported the Domestic-Waste-to-Energy Project in Vietnam, which collects 650 tons of household waste daily (representing 85-90% of all household waste) to generate 60,000,000 kWh of green power annually, in full compliance with EU 2010 emissions standards. There BRI also supports clean energy projects in Africa, Pakistan, Myanmar, Laos, and many others, with the potential to provide access to energy to millions of people.

Importantly, the Chinese government has adamantly expressed its commitment to a green OBOR. It has announced intentions to formulate environmental risk prevention policies and measures and to build an environmental protection cooperation system for the BRI within the next three to five years.

That brings us to the Green Belt and Road Initiative (GBRI). What is the GBRI?

In December 2016, the United Nations Environment Programme (UN Environment) and the Chinese Ministry of Environmental signed a Memorandum of Understanding (MOU) on Building a Green Belt and Road. The parties agreed to share concepts and practices of ecological civilization and green development among participating countries, strengthen the coordination of environmental policies, laws, regulations and standards, discuss ways to further promote green development, organize international dialogues, and enhance data and information exchange.

Under the GBRI, UN Environment and the Chinese Ministry of Environmental Protection have put together an international study group to prepare a report on OBOR, centring on challenges and opportunities for the 2030 Agenda for Sustainable Development. The report is intended to enable its readers to understand the linkages between the BRI and the environmental, social, economic, and governance aspects of sustainable development, and how to engage to help shape the Initiative moving forward.

In 2018, UN Environment and the Chinese Ministry of Environmental Protection are expected to launch an international coalition to integrate “green” into the OBOR initiative, in engagement with governments, enterprises, international organizations, non-governmental organizations (NGOs), civil society groups, think tanks and other stakeholders. This task team will work to promote green policies, green infrastructure, green trade, green finance, and green interactions between the peoples of participating countries.

In your view, what are the most important policy messages related to the OBOR initiative?

Making sure the OBOR initiative is sustainable requires a myriad of tailored guidance, tools, best practices, strategic thinking. It requires the active involvement of those with the knowledge and expertise to build green. This includes not only inter-governmental organizations, but also think tanks and NGOs that can bring their respective knowledge, expertise, and tools, including those from their respective networks, to help shape BRI policies and projects.

They can, for example, support knowledge sharing, awareness raising, and capacity building in areas including environmental laws and legal institutions, impact assessment, public participation, decent work, gender equality, information disclosure, and negotiation of foreign investment projects. Some can publicize the long term benefits of green investments and facilitate green projects while others can provide independent monitoring, assessment, data, information and recommendations.

A distinctive category within national stakeholders are financial regulators who influence the flow of capital. They can embrace and integrate the concept of sustainable or green finance into their respective banking and security regulations so as to discourage financing for “black” and “brown” projects and encourage financing for green ones. In this regard, UN Environment’s Inquiry into the Design of a Sustainable Financial System and UN Environment Finance Initiative (UNEP FI) can provide valuable assistance, together with Chinese financial institutions that are currently leading the global green finance movement.

At policy level, it is important to have an inter-ministerial coordination mechanism and ways for meaningful and inclusive public participation in participating countries to ensure that the BRI is sustainable, and contributes to multiple climate and sustainable development goals and targets.

In short: cooperation between UN Environment, policy experts, think-tanks, NGO’s, and China and all participating countries is critical to integrating sustainability into key components of the BRI. We need to continue to explore ways to foster international dialogues and information exchange, catalysing the sharing of related ideas and practices.

The greatest risk to the sustainability of the initiative is that sustainability leaders and green policy and technical experts to refrain from getting involved, for whatever reason. We cannot afford to miss this opportunity; this project requires our knowledge, tools, best practices, and guidance for sustainable development and sustainable infrastructure, every step of the way.

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The GGKP was established by the Global Green Growth Institute (GGGI), the Organisation for Economic Co-operation and Development (OECD), the United Nations Environment Programme (UN Environment), and the World Bank to identify and address knowledge gaps in green growth theory and practice.